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The importance of a secure supply chain

The importance of a secure supply chain

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With the global population expected to reach nine billion by the year 2050, the question of how to produce food for all those extra mouths is a worrying one for anyone involved in agriculture.
With the global population expected to reach nine billion by the year 2050, the question of how to produce food for all those extra mouths is a worrying one for anyone involved in agriculture.

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Published by: Milling and Grain (formerly GFMT) on Jun 18, 2014
Copyright:Traditional Copyright: All rights reserved


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Digital Re-print - May | June 2014
The importance of a secure supply chain
Grain & Feed Milling Technology is published six times a year by Perendale Publishers Ltd of the United Kingdom. All data is published in good faith, based on information received, and while every care is taken to prevent inaccuracies, the publishers accept no liability for any errors or omissions or for the consequences of action taken on the basis of information published. ©Copyright 2014 Perendale Publishers Ltd. All rights reserved. No part of this publication may be reproduced in any form or by any means without prior permission of the copyright owner. Printed by Perendale Publishers Ltd. ISSN: 1466-3872
ith the global population expected to reach nine billion by the year 2050, the question of how to produce food for all those extra mouths is a worrying one for anyone involved in agriculture.
Suppliers of feed and grain to the world’s livestock and animal industry are under immense pressure to not only provide an efficient service, but to ensure that products meet tough safety standards.  While few companies are completely  transparent about their supply chain intense competition makes them wary of dis-closing too much – in a market where trust and reliability is a crucial element of business, customers need to see the full picture. It’s a point that Chris Barnes knows all  too well, in his new role as head of supply chain and procurement at pathogen control specialist Anitox.“Trust is what underpins the client rela- tionship in any business,” says Mr Barnes and  the animal feed safety industry is no different.“Coupled with that is the expectation from key customers, of an ever increasing range of value-added services and innovative products that will improve their feed conver-sion ratios (FCRs),” adds Mr Barnes.Supplying clean and safe feed is of para-mount importance to businesses in the feed and grain market, especially where animal health is concerned - there is no room for error. As a specialist in the control of pathogens and microbes in feed, Anitox has to ensure  that its products reach customers in the best possible condition, being able to fulfill potential and perform at maximum efficacy. “In this marketplace your commercial success is dependent on the reliability and performance of your products. Anitox prides itself on its science-backed approach to busi-ness, so the challenge is to build a supply sys- tem that reflects this principle while building us a reputation as a reliable supply partner.“In the feed safety industry that kind of reputation is invaluable,” says Mr Barnes.
Understanding demand
Supply excellence starts with a thorough understanding of a company’s clients’ businesses, he explains. That means gathering a full under-standing of demand and how it fluctuates – fundamental knowledge if you’re to ensure your product is in the right place at the right time. “There’s no substitute for this. Neglect it and all confidence will be lost.”Mr Barnes cites the example of one of  the company’s main products, Termin-8. It’s a feed additive that’s used to eliminate pathogens and microbes from animal feed. “To reach the intended results and fulfill customer’s expectations, our product must be delivered on time, in a safe and secure manner. Part of the success of our products depends upon a fully-functioning supply chain system, that can guarantee safe passage of our product so that it delivers the results we promise.” Armed with the knowledge and under-standing of a client’s demand profile, fore-casting models can identify and highlight occasions when the supply chain might fall short, as well as predicting when product needs to be readily available for despatch.Planning to match demand is the core of a solid and reliable supply chain model.
Global supplies
Modern global trade means many manu-facturing companies are reliant on raw mate-rial supply from anywhere in the world,  thanks to ever more efficient transportation links. Of course, while that means costs can be reduced, it brings with it a particular type of risk.“Price and quality may dictate that you buy your raw materials from halfway across  the world,” Mr Barnes acknowledges. “But the further the product has to travel,  the more likely it is that something will go wrong at one point or another. “In a supply chain role, you’re prepared  to expect the unexpected. What is Plan B?“For us, it’s about ensuring there’s always someone else who can supply your most important raw materials at very short notice. No matter what the problem, or whose fault it was, telling your customer that our supplier let them down simply won’t suffice.  We must be prepared to present alterna- tives and work on a solution to supply our customer’s needs.”
Supply chain links
It’s inevitable that supply chain links will break from time to time, but the measure of a good company is how well it deals with  those situations. “Demand fluctuation presents us with our trickiest challenge,” continues Chris, “which results in two problems in particular: over-stocking and short supply time. “Over-stocking can mean a prod-uct is stored for longer than anticipated. Sometimes that happens in locations that aren’t ideal for long-term, or even medium- term storage. That can result in product loss and economic losses. “Meanwhile, short supply creates the opposite problem: an inability to fulfill an order while leaving the customer with a loss of confidence and without the product it needs,” Mr Barnes.Now that Anitox is in an expansion phase, that brings with it an entirely new set of challenges. Growing size and customer base demands that plans are put in place to stop gaps appearing.“If you’re moving into new areas, then inevitably it increases the distance between  the production base and the customer’s location. “At Anitox, for example, we have half of our manufacturing sites in North America and yet our customer base is global. By 2020 we expect to be doing more business in Latin America and Asia than the rest of the world put together. “We’re continually scrutinising our supply chain, to identify and resolve potential risks with our manufacturing set-up. The constant reassessment of potential solutions, whether  that’s relocating manufacturing plants, build-ing new ones or looking for alternative sourcing to better supply our wider markets, means we’re always best placed to react to events.”Creation of new local manufacturing plants can bring huge benefits, creating new business opportunities and increas-ing consumer confidence by shortening  the link in supply but they’re reliant on having the volume of product flowing into  that area.“By predicting and modeling this type of movement, we can make plans that allow us to secure an efficient supply chain system into the future,” says Mr Barnes. Whatever the line of business, customer commitment and confidence-building is enhanced through the creation of honest and transparent supply chain models. Not only does it identify potential risks, but it also forces the business to address any problems head-on.
The importance of a secure supply chain
50 | May - June 2014GRAIN

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